In the recent past, the Carvill Group has mainly focused on the development and sale of residential and commercial buildings in Northern Ireland, Scotland, North East England and in Germany.
A feature of the registered accounts is the policy of the company of acquiring a major landbank to prepare for new developments. The financial results for the year to August 2008 reflect the first stages of the slow down in building activity and the impact of poorer market conditions for the sale of new property.
Although turnover fell only marginally, this impacted into operating profits which were 12% lower than the previous year. Pre-tax profits fell more sharply, largely as a result of higher net interest charges on borrowed funds, which were £1.7m higher in 2007-8.
The landbank valuations have been reduced by the changes in the property market. The market value, as estimated, fell to £127.3m at the end of August 2008 from a value of £175.3m a year earlier. The balance sheet pre-tax surplus on the value of the landbank fell by over £56m.
The value of borrowing to finance the business, repayable in more than one year, rose by £38m between August 2006 and August 2008. However, the value of the shareholders equity rose from £16.9m to £21.2m over the same two year period.